An Italian Investment Group Just Saved Aston Martin

Aston Martin is now in a
position to produce more cars like this DB5, once owned by Paul
McCartney.Courtesy of RM
Auctions

Aston Martin, maker of the luxury British sports car favoured by
James Bond, has revealed Investindustrial is pumping £150 million
($240.26 million) into the company.

The deal will see the Italian private equity fund take a 37.5
percent stake in Aston Martin, which said the investment would
allow it to accelerate its product development and international
expansion.

It values the company - which is 100 years old next year - at
close to £800 million ($1.28 billion), and makes Investindustrial
a shareholder alongside Aston Martin's Kuwaiti owners Investment
Dar.

David Richards, Aston Martin's chairman, said: "It gives
stability to the company and certainty of product planning for
the next few years.

"Without it development plans would have been slower because with
the market as it is at the moment, you have to be fairly cautious
about investment."

He said the company plans to invest more than £500 million
($800.85 million) in new products and technology over the next
five years.

About 70 percent of Aston Martin vehicles are exported and the
company has been expanding in China over the last 18 months, the
full benefit of which is yet to be felt.

Andrea Bonomi, senior principal at Investindustrial, described
Warwickshire-based Aston Martin as an "iconic global, but
quintessentially British brand."

He added: "We are looking forward to working with the management
and Investment Dar to achieve a similar transformation and
rejuvenation that we achieved with [Italian motorcycle company]
Ducati, by expanding the model range and strengthening the
dealership network, throughout the world.”

The deal ends weeks of speculation about a sale of a stake in the
car manufacturer. It is thought five serious bidders were
circling Aston Martin, including Indian manufacturer Mahindra
& Mahindra which is thought to have pulled out.

Last week Moody's
said it was reviewing Aston Martin's credit rating with the
possibility that it might be downgraded deeper into "junk"
territory because of a weaker than expected performance.

The company sold 2,520 cars in the year to the end of September,
20 percent fewer compared with a year earlier, and well below
pre-recession levels of more than 7,000.